MADISON - With a name like Platypus, itís clear that the founders of this nanotechnology start-up possess a quirky sense of humor, to say nothing of the confidence that what they have to offer is sound enough to overcome the off-beat name.

Others, at least those in the government grant-giving world, seem to agree. So far, the four-year-old firm has received 12 federal grants worth $7.1 million, which may be more than any other tenant at University Research Park on Madisonís west side.

And that strange animal name? Turns out itís not quite so goofy as it sounds.

When the company founders had to pick a moniker back in 2000, they decided to take the whimsical route.

"First we filled two blackboards trying to come up with something that was related to the technology, but they all seemed totally forgettable to us," said CEO Barbara Israel, a University of Wisconsin virologist who earned her PhD in medical microbiology.

"They all would degenerate into something with 'nano' or 'gen,' and there are a thousand companies with those prefixes or endings," she said.

Her fellow entrepreneurs are Nicholas Abbott, a chemical engineering professor, and Christopher Murphy, a veterinary medicine professor. "Or it was initials that would all get transposed," Israel said. "Then Nick, who is from Australia, said, 'Why donít we just go with something fanciful like platypus, which is a unique animal composed of a lot of different parts.'"

It certainly didnít hurt that the odd-looking creature has characteristics that dovetail with what the company does.

"The basis for our technology is fabrication of tiny surfaces -- measured in units as small as a billionth of a meter -- that have a very special topography or structure on them that we embed with specialized receptors," she said.

Similarly, the platypus features a huge bill that is a highly specialized surface with minute electro-chemical receptors that let it detect its prey in muddy water. It does not use its eyes, ears or sense of smell to hunt.

"So there is an analogy there to our technology," she said with a grin.

Never in her career at the universityís veterinary school did Israel study platypuses; she focused mainly on viruses that afflict animals and humans. Currently, scientists at Platypus are working on two projects dealing with West Nile virus, which is spread by mosquitoes and can kill both animals and people. In one, the company is collaborating with the National Wildlife Health Department to develop more rapid ways to detect West Nile in a wide variety of animals.

The genesis of Platypus came when Israel, Abbot and Murphy met in the late 1990s while making their own discoveries. They learned they all had interest in practical, real-world applications of nanotechnology to the life sciences.

The trio took courses offered by the university and the Wisconsin Alumni Research Foundation on business planning for scientific entrepreneurs to help them think through their ideas before making the big jump. After filing articles of incorporation, they took about 18 months to apply for grants and assemble their management, legal and intellectual property teams. In July 2001, Israel, Abbott and Murphy opened a lab at the University Research Park.

During that time, they also applied for five grants, hoping they might receive at least one. They were astounded when all five requests were successful.

"That was quite a start," Israel said, shaking her head. So far, the grants have come from agencies ranging from the U.S. Department of Agriculture to the National Institutes of Health to the Army to the National Science Foundation.

The company now has 20 employees, most of them scientists earning salaries comparable to their university peers. They work in a 3,500-square-foot lab in the research park's MG&E Innovation Center, but may soon move to larger quarters.

Steve Crosby, editor and publisher of Small Times, an Ann Arbor, Mich. publication and Web site about small technology, called Platypus' grant success impressive. Though Wisconsin ranks 25th for commercializing products at the molecular level, Crosby said the Badger State is fourth in attracting venture capital, with nearly all of those dollars going to Madison and surrounding environs.

"It's because of the university, clearly," Crosby said. "And people in Madison seem to have figured out how to attract money not only from the Midwest and around the country, but from overseas, too."

For fiscal 2005, he said the federal budget will pump $1 billion into nanotechnology research. Private U.S. corporations will invest another $1 billion on research this year, he estimated. Japan and the European Union each will spend a slightly smaller amount.

Crosby said there about 800 nanotechnology companies in the U.S., with about 45 percent actually producing something.

"It is a hot area and a real race internationally because nano-enabled technologies will create the next generation of products in a lot of different fields," he said.

Not long after opening Platypus began selling kits and tools featuring the same materials they use to do their own research. These include gold-plated silicon wafers and microscope slides with different thicknesses of gold and polyurethane substrates. All are used to do assays and other tests. Platypus has three patents of its own, as well as an exclusive license to eight patents and associated foreign filings through WARF.

As for Platypus Technology's future, Israel said she hopes the company is headed for success. And she's shooting for profitability by 2008, though that date may be a moving target.

"We'll know we are successful when people start using 'Platypus' as a verb, like Google," she quipped.

With Platypus poised for growth, Israel is close to completing the transition from academia to the business world. A senior, non-tenured scientist at the veterinary school, she is closing her lab at the university at the end of August Ė though she will continue to lecture and work with student committees. Platypus may also collaborate with the university on research.

"Iíve been 20 percent time for the last year and was 49 percent when we started," she said. "I have an NIH grant that is ending, so this is a good time to shut down the lab."

Israel said some of her colleagues who have followed her career are interested in starting companies stemming from discoveries in their own labs.

"I think there is growing support at the university to do that," she said.

For the time being, Platypus is working to get a third generation of materials on the market this fall. Israel declined to reveal sales figures, but said the so-far small revenue stream is growing.

Liquid crystal-based assays under development are also in various stages and could come on the market within several years. Liquid crystals are optical amplifiers, the visual elements used in digital watches, computer monitors and even in mood rings.

One new product is a small, wearable monitor to measure cumulative exposure to low doses of pesticides, which would replace large vests with 10-pound batteries currently used. This could be valuable to researchers who are studying the links between small doses of toxins and developmental problems in children, she said.

Israel said she especially proud of a Platypus discovery that deals with how liquid crystals line up in response to viruses. If the discovery can be applied in the field, it could allow researchers to quickly identify pathogens like foot-and-mouth disease, West Nile virus, cryptosporidium or E. coli. Currently, those tests must be conducted in a sophisticated lab by highly trained technicians and scientists using time-consuming procedures, she said.

The research has NIH and Army backing. It could help soldiers in the desert or jungle rapidly detect nerve gases or viruses by using a truck-based lab to do tests, she said.

"Thatís an exciting project, though it may take some time to be completed," she said.

Israel said she believes the potential of the company is only beginning to become clear.

"There are so many ideas for applications," she said. "You have to pick a few and see where they lead and then focus in on the ones that prove to be the best."